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16 October 2020

Why it is cruel to impose local lockdowns without a nationwide furlough scheme

The government should not restrict movement if it is unwilling to pay the costs of those restrictions.

By Stephen Bush

Will Greater Manchester be forced into tier three lockdown restrictions? The government is contemplating it despite the objections of the region’s metro mayor, Andy Burnham, and of its MPs: including its Conservative ones, while Lancashire will enter tier three after having agreed additional economic support measures (the extent of which are yet to be announced). 

Besides the metro mayors themselves, few politicians seem to have grasped that the misery caused by regional lockdowns up until now is as to nothing compared to what combining the end of the original furlough scheme with the new restrictions will bring. 

[see also: How Boris Johnson’s indecision over a second Covid-19 lockdown is splitting the Conservative Party]

Don’t forget that only businesses compelled to close by government fiat can access the new furlough scheme. If you’re a restaurant, a gastro-pub or pretty much any non-descript chain establishment you might watch the football in, then you are able to remain open even in tier three – you receive no extra financial support as it stands. 

That has two consequences: the first is that to the social misery of lockdown we can add an even more painful direct and indirect economic hit as wages are slashed, while the second concerns lockdown observance.

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Rishi Sunak is contemplating further relief measures for areas that are locked down, but the problem is that the economic consequences of lockdowns extend outside their own surrounds. Lancashire’s lockdown has economic consequences for pubs and cafés in Kendal. London’s lockdown has consequences for hotels and restaurants in Kent. Indeed, Lancashire’s lockdown affects restaurants in Kent and London’s lockdown has an impact on pubs and cafés in Kendal. 

It cannot be the case that a café in a beauty spot in the Lancashire countryside deserves economic support but one in a beauty spot in Cumbria needs to adapt or die. The approach only makes sense if you believe that people in tier three areas will violate lockdown guidelines and travel freely to socialise in restaurants, pubs etc in tier one and tier two areas: in which case, what’s the point of tier three anyway? Of course, the reason for this is that Rishi Sunak believes that we should worry about the huge increase in the British government’s debt, and that the economic support measures need to be reduced sooner or later. 

[see also: Everybody has missed one loophole in the new lockdown rules]

I’m not going to litigate the reasons why I think that’s wrong and that the coronavirus crisis should be treated in the same way we treated the Second World War (or the First World War, or the Napoleonic Wars for that matter) – a time to borrow as much as you need and to worry about the debt much, much later – because it’s beside the point.

If you agree with Sunak’s argument, then lockdown is a policy you can’t afford. You can’t have restrictions on movement if you’re not willing to pay the costs of those restrictions. It’s arbitrary and cruel. If you don’t want a nationwide furlough scheme, then you can’t impose lockdowns. That’s why countries without the benefit of a powerful central bank have ended their lockdowns and why it remains both crazy and cruel that the United Kingdom is enforcing lockdowns on households and businesses without maintaining sufficient economic support to do so. 

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